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TMI Blog2019 (1) TMI 514X X X X Extracts X X X X X X X X Extracts X X X X ..... Act and it was held that in the event the accused is able to raise a probable defence which creates doubt with regard to the existence of a debt or liability, the presumption may fail. The standard of proof evidently is preponderance of probabilities. Inference of preponderance of probabilities can be drawn not only from the materials on record but also by reference to the circumstances upon which he relies. Therefore, the rebuttal does not have to be conclusively established but such evidence must be adduced before the Court in support of the defence that the Court must either believe the defence to exist or consider its existence to be reasonably probable, the standard of reasonability being that of the prudent man. The standard of proof so far as the prosecution is concerned, is proof of guilt beyond all reasonable doubt, however, the one on the accused is only mere preponderance of probability. Therefore, once the accused/respondent No.1 has probabilized his defence by showing the consideration to be improbable or doubtful, then obviously, in the given facts and circumstances, the appellant was obliged to prove the existence of consideration as a matter of fact and upon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... meeting out the expenses of labour etc. which amount was not returned to the appellant. 4. Thereafter, in the month of September, 2011, accounts were finally settled between the appellant and the above named authorized agent of respondent No.1 and in terms thereof a sum of ₹ 5,38,856/- was recoverable as on 12.09.2011 for the payment of which respondent No.1 issued a cheque No.942816 dated 02.10.2011 amounting to ₹ 5,38,856/-. The appellant presented the cheque for encashment, however, the same was returned by the bank for insufficiency of funds in the account of respondent No.1. The appellant thereafter contacted respondent No.1 over telephone, who assured him to make the payment within a few days, but to no avail. The appellant eventually presented the cheque for encashment at the Punjab National Bank, Anni, however, the same was returned unpaid for insufficient funds vide memo dated 11.10.2011. Thereafter, the appellant served respondent No.1 with a legal notice dated 22.10.2011 under registered cover which was sent to the official as well as home addresses of respondent No.1 and duly received by him on 27.10.2011. However, despite the receipt thereof, no pay ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 138 for the discharge, in whole or in part, of any debt or other liability.] 10. Chapter XVII containing Sections 138 to 142 was introduced in the Act by Act 66 of 1988 with the object of inculcating faith in the efficacy of banking operations and giving credibility to negotiable instruments in business transactions. These provisions were intended to discourage people from not honouring the commitments by way of payment through cheques. It is for this reason that the Courts should lean in favour of an interpretation which serves the object of the statue. 11. In M.S. Narayana Menon alias Mani versus State of Kerala and another (2006) 6 SCC 39 , the Hon ble Supreme Court while dealing with a case under Section 138 of the Act held that the presumption under Sections 118(a) and 139 were rebuttable and the standard of proof required for such rebuttal was preponderance of probability and not proof proved beyond reasonable doubt and it was held as under:- 29. In terms of Section 4 of the Evidence Act whenever it is provided by the Act that the Court shall presume a fact, it shall regard such fact as proved unless and until it is disproved. The words 'pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .. Standard of proof on the part of an accused and that of the prosecution in a criminal case is different. * * * 34. Furthermore, whereas prosecution must prove the guilt of an accused beyond all reasonable doubt, the standard of proof so as to prove a defence on the part of an accused is preponderance of probabilities ... * * * 45 .. Statute mandates raising of presumption but it stops at that. It does not say how presumption drawn should be held to have rebutted. Other important principles of legal jurisprudence, namely presumption of innocence as human rights and the doctrine of reverse burden introduced by Section 139 should be delicately balanced .. 14. Earlier to that the Hon ble Supreme Court in Hiten P. Dalal versus Bratindranath Banerjee (2001) 6 SCC 16 , compared the evidentiary presumptions in favour of the prosecution with the presumption of innocence in the following terms:- 22 ..Presumptions are rules of evidence and do not conflict with the presumption of innocence, because by the latter all that is meant is that the prosecution is obliged to prove the case against the accused beyond reasonable doubt. The obligation on the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ve that the instrument, say a note, was executed by the accused, the rules of presumptions under Sections 118 and 139 of the Act help him shift the burden on the accused. The presumptions will live, exist and survive and shall end only when the contrary is proved by the accused, that is, the cheque was not issued for consideration and in discharge of any debt or liability. A presumption is not in itself evidence, but only makes a prima facie case for a party for whose benefit it exists. 19. The use of the phrase until the contrary is proved in Section 118 of the Act and use of the words unless the contrary is proved in Section 139 of the Act read with definitions of may presume and shall presume as given in Section 4 of the Evidence Act, makes it at once clear that presumptions to be raised under both the provisions are rebuttable. When a presumption is rebuttable, it only points out that the party on whom lies the duty of going forward with evidence, on the fact presumed and when that party has produced evidence fairly and reasonably tending to show that the real fact is not as presumed, the purpose of the presumption is over. 16. The Hon ble Supreme Court therea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion of law, it can conveniently be held that in terms of Section 4 of the Evidence Act whenever it is provided by the Act that the Court shall presume a fact, it shall regard such fact as proved unless and until it is disproved. The words proved and disproved have been defined in Section 3 of the Evidence Act. 19. Applying the said definitions of proved or disproved to the principle behind Section 118(a) of the Act, the Court shall presume a negotiable instrument to be for consideration unless and until after considering the matter before it, it either believes that the consideration does not exist or considers the non-existence of the consideration so probable that a prudent man ought, under the circumstances of the particular case, to act upon the supposition that the consideration does not exist. For rebutting such presumption, what is needed is to raise a probable defence. Even for the said purpose, the evidence adduced on behalf of the complainant could be relied upon. 20. The standard of proof evidently is preponderance of probabilities. Inference of preponderance of probabilities can be drawn not only from the materials on record but also by reference to the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en signed by CW-3 Prem Chand and against that it has been written Munshi . 26. Mr. Bhardwaj would claim that CW-3 Munshi had executed this receipt acknowledging that an amount of ₹ 5,38,856/- was due and payable by respondent No.1. However, I find that nowhere in the complaint has CW-3 been referred to as a Munshi which in common parlance is understood to be a secretary or an assistant . 27. Munshi , in fact is a Persian word originally used for a contractor, writer or a secretary and later on was used in the Mughal Empire and British India for native language teachers, teachers of various subjects especially administrative principles, religious texts, science and philosophy and also secretaries and translators employed by the Europeans. Munshi could also be a scribe, clerk or an accountant, but the said term was never used for an agent. Even otherwise, the agency as defined under Section 27 of the Act was required to be established and proved by the appellant before CW-3 could in fact be held to be the agent of respondent No.1 so as to enforce the liability upon him. 28. Another contradiction in the case of the appellant is with regard to charges of carri ..... X X X X Extracts X X X X X X X X Extracts X X X X
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